The band bank...


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JacK C
01-03-2010, 04:19 PM
I just want to be more clued up on this subject...

For bands that make money...how do you handle it?

A friends band of mine were reasonably successful and had their own bank account for the band to keep things organised that way, where the money only went towards petrol or general costs/nothing for the band to take for themselves (they all had jobs)
This seems the best way in my eyes, but i'm naiive as hell on this subject, and i'm rubbish with money in general (having any interest for it/attention span/patience, rather than being reckless with it).

My situation - is that i've got a band that's moving quickly, we've got 5 originals and more on the way, and a friend of a friend who owns a bar and has asked us to play a couple at his place and he'll give us 20. Not much, but i want to be on this money malarky from the start rather than let it just fall through hands. I want to make a responsible pot which we can use for costs/rehearsal/recording.
EDIT: We're all 22-25 with jobs, if that helps.

What do you guys do in regards to money made through your band?
Also, what do you find most of the money goes towards or gets spent on?

I would rather only get responses from people with experience in this subject, thanks in advance for your time.

PirateXc
01-03-2010, 04:33 PM
Well I'm only seventeen but theres been a couple shows where we've been paid from 50 to 100 dollars. We kept it in the money box that we use when selling merch, all of the bands money is no single persons and can only be used for gas money, water for a show, food for the entire band etc. That way we have money saved if we want to record or have someone design more shirts for us.

axemanchris
01-03-2010, 04:40 PM
We have a band account. Like you, we all have jobs, so we didn't depend on the band for money. We took all gig money, and all CD and merch sales and that money went into the band account.

We used our own money for gas and personal expenses.

Some of the things we used the band account for:
1. Paid for our CD duplication/manufacturing costs
2. Paid for our merch, stickers, etc.
3. Paid for a repair when one of our amps got damaged as a result of mis-handling at a gig.
4. Paid for a venue and technical crew for a show we organized at a theater.
5. Printing of posters, tickets, etc.
6. Web hosting
7. Submission fees for festivals, etc.

Now, initially, we paid for our CD duplication out of our own money, as we didn't have any income at the time we did our CD. So there was one point where we paid ourselves back for the money we initially fronted.

CT

JacK C
01-03-2010, 04:50 PM
Really helpful insight guys, thanks.

Have you got a written contract on any of this too? In case any bullsh!t starts?

iwannabesedated
01-03-2010, 07:02 PM
I've seen bands split it with half of the money going into a "band account" and half being split up among the members. Band account going for band things like recording, gas, etc.

axemanchris
01-03-2010, 11:36 PM
We only did a written contract when we rented the theater for our own event.

Aside from that, we played clubs that had a reputation for treating bands fairly, and played festivals that had all been around for a while, and thus, had an established reputation.

When you play locally, your reputation actually means more than a single piece of paper with some contractual clauses on it. There's a lot to be said about relationships too. We've played at such and such a club a couple of times. Lou wouldn't screw us over because we have established a relationship. That sort of thing.

Relationships go both ways, though. If I have a relationship with a promoter who books us into a club, as he has done a few times before, and the turnout is less than half of what anyone hoped for, and he in turn offers us less than we had agreed because he's obviously taking a loss on the night as it is, then it is only decent of us to condede and accept that.

And really, as an original band, there's not much money at stake. Any club owner who is going to stiff you out of $100 has to be pretty desperate.

Now, the rules change slightly if you are a cover band, because there are more venues, more promoters that come and go, and more money involved.

If you play out of town, you don't have much of a relationship or a reputation to go on. For all you know, the guy booking the club just moved into town two weeks ago and has just started screwing bands over and word hasn't gotten out yet. Or, he's been there forever and the reason why they book out of town bands is because all the locals know better than to book there.

That's when you want to consider written agreements.

CT

MR. Goodcents
01-04-2010, 03:02 AM
We don't make a ton of money but, when we do we just split it evenly between the members. Whenever we need to pay for rehearsal studio we just split the cost evenly. So it's up to the band members if they want to spend all that money they got from the gig that's fine, but we all know that we still will have to pay for the practice space.

Myke.
01-04-2010, 09:28 AM
We put ours into a fir/water safe box and use it as we need.
For (gas, merch, etc...)
We all have an established trust that the money will be put toward band needs.

6stringbassist
01-04-2010, 10:58 PM
We kept it in a box that was never used for anything but band money, and we left it with the most responsible band member.

Myshadow46_2
01-05-2010, 07:44 AM
Practice costs 30 for three hours. All members pay 10, so we have 10 left (4 members) which goes into my savings account. This is then used for expenses and new gear. For example, our drummer wants a double bass pedal. He'll pay half from his money, the other half comes from the band account. He therefore owns 62.5% of the product and the rest of us own 12.5% If the band splits we find the average cost of the item and split the cost depending on who keeps the it. If the money is used for expenses (petrol, new drum skin, repair, recording etc.) then the money is used completely from the bank account and nobody owns what was bought outright. A recording is the property of the band and stays with the band. A new drumskin is obviously used by the drummer, but once bought it is forgotten; by this I mean that if we split up we don't split the cost between us.

This works fine for us, I just need to keep an excel spreadsheet updated with ingoings and outgoings.

We haven't played a paid gig, the money would all go into the band account less a few beers after the gig!

axemanchris
01-05-2010, 09:02 PM
That's a good way of doing it because you have an agreement in advance of how that would work. Questions of ownership are often difficult to sort out when there is more than one entity paying for an item. There are a few considerations, though....

So, if you fire your drummer, or he quits, then he owes you 62.5% of the 'fair market value' of the pedal or the 'purchase price' of the pedal? Or failing that, could he say "screw you, keep the pedal and give me 47.5% of the purchase price of the pedal as a parting gift?"

The recordings belong to the band.... what happens when the band breaks up? Does nobody own the recordings, or do you all own them equally? What about when one member quits... is the new member entitled to any of the money gained from those recordings?

I'm not suggesting that your ideas are bad or wrong. At least you've put some thought into them. I'm just suggesting that your biggest arguments are going to be over money, value, and ownership, so those things need to be determined.

That's why we decided to keep personal stuff out of the band. You're entirely responsible for your own stuff.

A couple of strategies, though.... have occasional 'payouts' where everyone gets an equal (or at least equitable, but that's a touchy can of worms) amount of money from the band to do with what they please. The drummer buys his kick pedal, you buy yourself whatever, and so on.

Or buy stuff for the band - not for a player - and have an agreement that a member being fired or quitting does not mean they take band property with them when they go. It's not theirs. It belongs to the business. Just like when you quit your job at McDonalds, even though it was your work that helped pay for that new fryer, you don't attempt to justify taking that with you either. In the event of a band break up, all assets are liquidated and the money split up equally, or something like that.

We did face an issue similar to that. We had one of our original members quit about a year after we released our CD. As a four-piece band, we gave him 25% of the band money and 25% of the remaining CDs and merch. Those things are always potential personal landmines and can be hard to sort out.

CT

JagStang5246
01-05-2010, 10:52 PM
All money we make from shows and merch go into the band account. The band money is only used to pay for gas, more merch, or food for everyone. Not much else, and it doesn't seem worth it to split a $35 pay from a venue between 4 people, so no one really argues about where the money should go.

kyle62
01-05-2010, 11:56 PM
I just want to be more clued up on this subject...

What do you guys do in regards to money made through your band?
Also, what do you find most of the money goes towards or gets spent on?

I would rather only get responses from people with experience in this subject, thanks in advance for your time.
My band is all around the same age as you guys and we haven't bothered with a bank account so far - everything is paid in cash so it tends to stay that way unless we're making internet purchases (although we're all declared self-employed).
A personal account would limit us to one card and at the moment a business account is overkill.

We tend to split it up funds evenly at the end of the night, after putting aside travel expenses etc, and leaving a few quid for a 'band fund' when we can spare it.
Here's how we split our cash on Friday, for example:


Out of 200:


50 per band member (playing as a three piece)
20 travel expenses (car was overloaded, so 2 of us needed to get a long-distance coach there!)
15 band fund (used to pay for replacement sticks and strings, and burgers on the way home!)
15 for our long-suffering roadie/driver


Usually the travel expenses don't come into play, so we'd give extra money to our 'roadie', or put it in the band fund.
Our band fund is almost always empty, I need a set of strings once a week and our dummer gets through Pro Marks like they're matchsticks.
Occasionally we'll let it build up a little to pay for new gear (for example we're currently putting a tenner aside from each gig for a new kick mic).



Anyway you guys may be inexperienced and only playing orignals, but 20 is absolute robbery.
Think how much he'll take in drinks from your friends/family coming to watch you guys! I'd be looking for 40 for a half-hour original set, personally. Make sure you guys get a round of drinks or two on top of the 20 eh?

axemanchris
01-06-2010, 01:32 AM
Our band fund is almost always empty,

From reading your post, that's no surprise.

That's not a criticism, because you haven't stated that having band money is a priority. For many people, they just like to have the extra spending money. Especially if you're doing covers, where recording a CD is not only pointless, but serves only as a liability.

It is also a reality that many musicians rely on gig money to help them pay rent and buy food and such. In that case, the money is better used feeding my kids than saving up for some joker's new flying V.

However, if your goal is to run a successful business (as opposed to a series of "service calls" - especially if you are doing originals - then you have to re-invest in your business. Few businesses can do well when they spend 90% of their gross earnings on salaries and fritter the rest away on beer. (we've all seen it....)

CT

kyle62
01-06-2010, 06:32 AM
if your goal is to run a successful business (as opposed to a series of "service calls" - especially if you are doing originals - then you have to re-invest in your business.
CT

Precisely. I've seen bands who'll even use their collective fund to buy new guitars, drums etc...I could never imagine doing that! I'm sure the model works for some, but generally the guitarists/drummer own their own gear.

We recently spent around 900 on PA gear though - fortunately the other band members are professional enough to understand that just because only two of us sing, the purchase benefits the whole band equally by making us sound better.
There's can be little more frustrating than self-serving band members with no interest in the overall picture.
I had an argument with our bass player a few weeks ago as I wanted to borrow his vocal mic to mic the kick, explaining that as a large venue, it was essential the bass drum cut through as it's essentially the 'beat', the bit people dance to. He told me to sod off as he wanted to use it for vocals (despite the fact he can't and doesn't sing), and he could do what he wanted as it was his mic.
This 'who cares as long as I look good' attitude is really bad for a band, and these'll often turn out to be the people who want their share of money every time instead of putting it back into stuff that'll benefit everyone.

Make sure you've spoken to your whole band and agreed in advance on how you're going to deal with money. Lay down some set plans, and perhaps make a 'wish list' of gear the band needs so you don't get any sort of power struggle.

And unless you guys are absolutely dire, don't settle for 20!

Myshadow46_2
01-07-2010, 08:31 AM
That's a good way of doing it because you have an agreement in advance of how that would work. Questions of ownership are often difficult to sort out when there is more than one entity paying for an item. There are a few considerations, though....

So, if you fire your drummer, or he quits, then he owes you 62.5% of the 'fair market value' of the pedal or the 'purchase price' of the pedal? Or failing that, could he say "screw you, keep the pedal and give me 47.5% of the purchase price of the pedal as a parting gift?"

yeah, that's the guideline

The recordings belong to the band.... what happens when the band breaks up? Does nobody own the recordings, or do you all own them equally? What about when one member quits... is the new member entitled to any of the money gained from those recordings?
Band breaks up, physical recordings are split between members. Songs still belong to the band i.e. they were the songs the band played, they will always be the band's (like not taking the fryer from McDonalds when you move to KFC). Not thought about a new member situation :bonk:

I'm not suggesting that your ideas are bad or wrong. At least you've put some thought into them. I'm just suggesting that your biggest arguments are going to be over money, value, and ownership, so those things need to be determined.

yeah, definitely. Bands tend to be fine and dandy until they go bad. You can't account for douchbaggery, but at least agreed guidelines should, hopefully, minimise these issues

That's why we decided to keep personal stuff out of the band. You're entirely responsible for your own stuff.

A couple of strategies, though.... have occasional 'payouts' where everyone gets an equal (or at least equitable, but that's a touchy can of worms) amount of money from the band to do with what they please. The drummer buys his kick pedal, you buy yourself whatever, and so on.
We did think about this. Possibly putting 50% of paid gigs into the account and splitting the rest between members as a payout. We've not set a guideline yet.

Or buy stuff for the band - not for a player - and have an agreement that a member being fired or quitting does not mean they take band property with them when they go. It's not theirs. It belongs to the business. Just like when you quit your job at McDonalds, even though it was your work that helped pay for that new fryer, you don't attempt to justify taking that with you either. In the event of a band break up, all assets are liquidated and the money split up equally, or something like that.

We did face an issue similar to that. We had one of our original members quit about a year after we released our CD. As a four-piece band, we gave him 25% of the band money and 25% of the remaining CDs and merch. Those things are always potential personal landmines and can be hard to sort out.

CT

The problem with all guidelines is that band members are human! Once things go bad, people can get nasty. I like to think all the members in my band are gonna play fair, but I know being prooven wrong is definitley on the cards. You take it as it comes, I guess, and work things to the best of your ability.

JacK C
01-08-2010, 06:51 PM
This has all been really helpful (bar one post) and really insightful, so thank you very much to everyone that's replied.

I've decided to keep () as a 'pot' for now which i'll look after, till it turns into money that can talk and then we'll put it in a bank.
But for now, i think that's a step too far, and a bit of unnecessary pressure/responsibility on the band which i think would hinder it rather than help it at our very early stage.
After all, i want at least another 6 weeks before we even start booking gigs to make sure we're tight/read eachother well before we hit the stage, and thing's are moving fast enough as it is, but maybe that's for another thread if i need your help again.

For now i'm gonna concentrate on the music, but i'll definately be refferring back to this thread in a month to help decide the bastard money proccess of being in a band.
You guys have been very helpful, thanks again.

RE: kyle62

For me, any money being offered seems nice at this point, having not even played a gig or any decent quality tracks for people to enjoy.. but out of interest, how much money did you get for your first gig? And what stage were you at as a band? Was money always in mind/conversation from the start? Do you guys live by what your band makes?
Also, we'll definately expect someone to buy us a round afterwards, fo sho ;)

Lams
01-08-2010, 11:06 PM
Practice costs 30 for three hours. All members pay 10, so we have 10 left (4 members) which goes into my savings account. This is then used for expenses and new gear. For example, our drummer wants a double bass pedal. He'll pay half from his money, the other half comes from the band account. He therefore owns 62.5% of the product and the rest of us own 12.5% If the band splits we find the average cost of the item and split the cost depending on who keeps the it. If the money is used for expenses (petrol, new drum skin, repair, recording etc.) then the money is used completely from the bank account and nobody owns what was bought outright. A recording is the property of the band and stays with the band. A new drumskin is obviously used by the drummer, but once bought it is forgotten; by this I mean that if we split up we don't split the cost between us.

This works fine for us, I just need to keep an excel spreadsheet updated with ingoings and outgoings.

We haven't played a paid gig, the money would all go into the band account less a few beers after the gig!

it would be really funny if this is how you would deal with your girlfriend. i say, great movie plot here. you can use my idea as long as you give me some credit. i would call it: "Spreadsheet Relationship"
Now seriously, it seems like you have a band and you're already planing on ending it sometime, before even playing a paid gig. That's really pessimist. Why don't you just split all the costs? 30/4 is a real number, it's 12,5.
That's how i do it with my band, the only band money we have is 30 euros and i trust the other guitarist to keep it. If when we need it, he doesn't have it, well, that's a problem but i'm not thinking about the worst that can happen and anyway it's just 30 euros. If we ever get paid like more than 50 euros for one night, then it's serious business and i think the best option would be bank account. But that's thinking about what may take a real long time to happen/never happen.

axemanchris
01-09-2010, 10:20 AM
The difference is, when you get married, for instance, it is based on the premise that it is forever, though statistically, it often isn't.

*All* bands break up and/or have members leave at some point. You *have* to plan for that inevitability.

It's not pessimism. It's being realistic and being proactive.

And splitting the money equally each gig.... does it make sense for *any* business to spend 100% of their gross earnings on salaries?

CT

Lams
01-09-2010, 12:01 PM
And splitting the money equally each gig.... does it make sense for *any* business to spend 100% of their gross earnings on salaries?

CT

i don't know if this part was still about my post, but that's not what i defend. the earnings go to the band itself. most of the costs like rehearsal and recordings is the thing that should be divided by all members, at least until earnings >>> expenses

Anteaterking
01-09-2010, 01:06 PM
Consider it like an insurance company does. Paying your members more is like having a low deductible. They should therefore cover more of the operating costs themselves. But if you pay your members less, it's like a high deductible, where the insurance company throws in more benefits.

Something like strings, for example. I go through a set of strings every four months or something like that. But my friend who gigs goes through them quicker than that. If he didn't have to gig, he wouldn't have to change his strings as much. In that sense, there is a sort of sense that the band owes it to him to pay for all or at least part of his strings.

Myshadow46_2
01-11-2010, 06:50 AM
it would be really funny if this is how you would deal with your girlfriend. i say, great movie plot here. you can use my idea as long as you give me some credit. i would call it: "Spreadsheet Relationship"
Now seriously, it seems like you have a band and you're already planing on ending it sometime, before even playing a paid gig. That's really pessimist. Why don't you just split all the costs? 30/4 is a real number, it's 12,5.
That's how i do it with my band, the only band money we have is 30 euros and i trust the other guitarist to keep it. If when we need it, he doesn't have it, well, that's a problem but i'm not thinking about the worst that can happen and anyway it's just 30 euros. If we ever get paid like more than 50 euros for one night, then it's serious business and i think the best option would be bank account. But that's thinking about what may take a real long time to happen/never happen.

Another way you could look at it is in an office which relies on it's computers, is it pessimistic to have a disaster recovery plan just in case the building burns down with all your information in it? No, it's just sensible.